Robust California almond industry feasts on worldwide demand

The world has gone nuts, bonkers, and delirious for California almonds, thanks in part to the Almond Board of California (ABC).

“We (ABC) are never satisfied with merely being good … our reputation is to push the envelope,” said Richard Waycott, ABC’s president and chief executive officer, Modesto, Calif.

Waycott’s poised stance and voice exuded confidence during his ABC Year-in-Review report to a standing room-only crowd of almond growers, handlers, shellers/hullers, pest control advisors, chemical reps, bankers, and numerous others tethered to California’s almond industry.

About 1,500 people attended the 35th annual Almond Industry Conference in Modesto in December.

“We’re making history across all sorts of areas and by all sets of measures,” Waycott said. “We’re harvesting record crops … Virtually every month we are shipping record numbers domestically and for export. We have continued to invest in and develop premier nutrition research as compared to any other nut industry.”

The almond industry is blazing trails while promoting what Waycott called the “world’s healthiest specialty crop.”

Absent from Waycott’s address was any reference to specific challenges faced by the almond industry. Almonds were recalled in 2001 and 2004 due to salmonella found in raw almonds. The industry responded with a voluntary pasteurization plan. Mandatory almond pasteurization took effect on Sept. 1, 2007. Pasteurization is required for almonds shipped within the U.S., to Canada, and Mexico.

The almond industry has reasons to crow like a top-rated rooster. During the 2006-2007 crop year, California’s 6,000 almond growers produced 1.117 billion pounds of almonds on about 615,000 bearing acres. Top producing counties included Kern (22 percent), Fresno (21 percent), and Stanislaus (15 percent), according to statistics from the U.S. Bureau of the Census and the U.S. Department of Commerce.

In 2006, almonds were California’s No. 1 agricultural export with sales valued at $1.89 billion, followed by the wine industry with $736 million in sales. Almond prices averaged $1.87 per pound for the 2006-2007 crop year, according to the National Agricultural Statistics Service.

Almonds ranked No. 1 in the nation in specialty crop exports with sales to 80 countries. California grows 80 percent of the world’s almond supply, and 100 percent of the U.S. commercial supply.

In 2002, the ABC board of directors crafted a five-year plan to meet new industry objectives. Like a fast moving elevator, the “Good to Great”-themed effort elevated the California almond industry, as Waycott explained, from a “good” industry to “great and sustainable” status. The path has led to seeking solutions for environmental challenges, and ensuring basic and applied research capabilities to keep almond farms top performing.

“We’ve collaborated as an industry in the face of adversity,” Waycott said. “It all comes together in a simple statement — together we can. Together there is no mountain too high or no valley too low. There’s no adversity so adverse that can’t be overcome.”

These successes have hoisted the almond industry into a new leadership role in agriculture.

“We’re a $3 billion industry that’s number one in exports from the United States to the European Union, India, and number two to several other countries. We’ve taken on a much larger responsibility and opportunity.”

That means the ABC is looking at almonds as a ladder with many rungs to elevate the industry’s position in two areas — first as the ‘crop of choice’ by providing leadership in agricultural policy, the evolution of regulatory requirements, and setting priorities for agriculture in California and the nation.

Second is to become the ‘nut of choice.’ The ABC has 11-year baseline hallmark nutrition research extolling almonds as heart healthy and a cholesterol reducer. Moving forward to become essential to customers and consumers will require new creative programs, further market expansion, and new communication channels.

“As we get both of these areas firing on all cylinders, then we will realize our vision as the world’s healthiest specialty crop,” Waycott said.

In February 2008, the ABC board of directors will stare gain into a crystal ball — to gaze and map out the organization’s direction for the next 15 years. The ABC will fine-tune existing programs to meet the new or redefined goals.

“We are extremely passionate about our mission. We feel like guardians of this industry. It is a big responsibility that we take very seriously,” Waycott said.

Global marketing

A critical milestone the ABC accomplished in the 2006-2007 crop year was a global demand analysis and the resulting global marketing strategy, according to Shirley Horn, the ABC’s senior director of global marketing.

The ABC’s international committee headed by Dan Cummings initiated efforts to identify and capture relevant data on almond markets around the world.

“The result was probably the world’s largest Excel spreadsheet,” Horn said. “This new global strategic framework has become our compass for prioritizing investment decisions not only in marketing, but helping to focus the energies and efforts across the ABC organization.”

The framework’s crux involves three strategic imperatives: geographic, category, and health. The bottom line is better aligning ABC programs across geographies and integrating messaging within global regions. At the core of the message — a decade’s work of building a portfolio based on sound science supporting the health benefits of almonds.

“We must take a more active role in building this reputation around the world. The good reputation of California almonds as crop of choice and nut of choice is a fragile gift,” Horn said.

The global demand analysis identified key markets to gain the maximum use of almonds.

California almonds are exported to 90-plus countries. North America (the United States and Canada) and Europe are currently the world’s mega markets for almonds — accounting for nearly three-quarters of today’s volume.

“Last year these markets consumed a whopping 782 million pounds of California almonds,” Horn said. “According to the demand analysis, we expect the two markets to absorb 78 percent of our 1.5 billion pound crop, or 600 million pounds each by 2010.”

For these mega-almond market appetites, the ABC has placed a stronger emphasis on the industrial and food service sector — advocating that consumers love almonds and the nut adds value to products and inspires menu creations.

Probably the most successful marketing program in ABC history, Horn reflected, was the snack tin promotion. The ABC ran an advertisement in the Sept. 25, 2005 issue of Parade magazine promoting the consumption of a serving of almonds a day to help maintain healthy cholesterol levels. Almond-filled snack tins were mailed to the 100,000 people who responded to the ad. A follow-up survey in February 2006 indicated most almond tin recipients were still filling the tins with almonds for snacking.

Horn identified India and China as priority development markets, or “mega markets in training.” Down the road, the two countries could rival North American and Europe in almond consumption.

“India has a very strong heritage for almonds … Indian mothers give their children six almonds a day before they leave for school because they believe almonds promote mental acuity,” Horn noted. Japan and South Korea are viewed as regional drivers.

Horn said ongoing almond nutrition research has opened doors for almond sales.

“With the strength of our nutrition science and the relationships the almond industry has developed with key researchers around the world, we believe we’re earning a seat at the table in global health and nutrition discussions,” Horn said. “The scientific evidence on the nutritional health benefit of almonds gives us the opportunity not only to be part of that discussion, but part of the solution.”

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